The 1,200-square-foot Hair for All Seasons in Plymouth was too small to accommodate Kathryn Simpson and four employees, so she began consulting with Buffie Blesi, a Minneapolis business coach and franchisee of AdviCoach. The business-coaching firm helped in deciding whether to move and expand or quit the business.

Entrepreneurial: Salon owner takes the plunge and expands

Kathryn Simpson stands in the lower level of The Beauty Lab, her Golden Valley shop. She turned to a business coach and a real estate broker to help her decide whether to move her business. “I like the uniqueness of the space because it has two floors and we have room to expand here,” she says. (Staff photos: Bill Klotz)

The Beauty Lab’s two-level location allows room to grow

Kathryn Simpson had a problem: The salon she had owned and operated for 10 years had hit the wall.

Located in a Plymouth strip mall, the 1,200-square-foot Hair for All Seasons was too small to accommodate her and four employees, never mind those she would hire if she could add the spa services that clients sought elsewhere.

Simpson needed help in deciding whether to move and expand or quit the business.

In February 2011, she began consulting with Buffie Blesi, a Minneapolis business coach and franchisee of AdviCoach, a national business-coaching firm. Simpson, Blesi and Sean Coatney, a broker with CORE Commercial Real Estate in West St. Paul, scouted many locations, uneasily settling on a two-story former photography business in Golden Valley.

“We just couldn’t get our arms around that space, but we had a creative owner, I think, and a creative team coach in Buffie,” Coatney said. “She was very important to the process.”

The basement photo-processing space needed an extreme makeover to become Simpson’s new salon and spa, The Beauty Lab. Before opening in June, the space got new plumbing, venting and wiring. It now includes a 1,200-square-foot hair-and body-care products shop on the street level and the salon, manicure/pedicure areas and four skin treatment/massage rooms in the 4,000-square foot basement.

“I like the uniqueness of the space because it has two floors and we have room to expand here,” Simpson said.

To save money on the renovations, Simpson, her husband and brother-in-law did much of the demolition work. Simpson also shopped at Ikea and Crate & Barrel for inexpensive furnishings and accessories rather than having her interior designer do the shopping.

“That way I wasn’t charging her tens of thousands of dollars” said designer Michelle Drenckhahnof Spacial Adaptations in St. Louis Park.

Drenckhahn designed the space as “industrial glam or urban chic,” with wood, metal and glass product displays, polished concrete floors and an airy layout.

“I have been to a lot of salons, and I look at her and her husband and the people who work for her and they’ve got a kind of edge,” Drenckhahn said. “They’re very professional and capable, but it’s still not a stuffy place. It’s different, and I think that’s what she was going for.”

Outdoor light flows through a see-through staircase and railing into the lower level. To enhance that light and draw the eye away from the industrial-style ceiling, Drenckhahn suggested the white paint that spans the space from the ceiling to the lowest-hanging artwork or fixture on the walls. Pendant lighting keeps the atmosphere soft. Pale gray and lavender complete the salon’s color scheme. Simpson brought the gray into the separate massage area with nubby carpet tile.

“She threw it down on the floor and then I threw down the other piece and I said, ‘We need to do this checkered [design]. We’ll create the texture and the pattern effect without changing the color or changing materials,’” Drenckhahn said of the carpeting. “It tends to have a calming effect on people and that’s what you want when you’re going in for a massage.”

“We wanted the space to be kind of feminine and masculine at the same time,” Simpson said. “We wanted it to be kind of cocoon-like.”

Simpson landed a $140,000 Small Business Administration loan from Drake Bank in St. Paul to help fund the buildout.

“She had a good track record with her other business,” said Jeffrey Carter, vice president and commercial lender at Drake. Carter said he is comfortable with salon cash flow and likes The Beauty Lab’s location in the Town Square shopping and office center at Winnetka Avenue and Golden Valley Road. One block north of Highway 55, it’s seven miles from the old salon to keep existing customers coming back.

The U.S. salon industry is growing, too. Salons and spas make up 70 percent of the nearly 861,400 establishments, which include nail salons and barbershops, according to a 2010 survey by the Professional Beauty Association, a national trade group. Most are single locations with fewer than 10 employees. Nearly three-quarters of those with payroll employees, like The Beauty Lab, generate annual sales of more than $250,000. Many salons use contractors.

The association’s salon-spa performance index for the second quarter of 2012 indicated slight growth in service and retail sales, customer traffic, employees/hours and capital expenditures over the previous quarter. Thirty percent of salon/spa owners said they had made a capital expenditure for equipment, expansion or remodeling, up from 21 percent in the first quarter. They expected continued growth over the next six months. Minnesota results were not available.

Simpson cross-promotes with other Golden Valley businesses and leased stylist work stations on wheels make way for book club meetings and other events. The spa’s walls serve as a rotating gallery of local artists’ work.

Simpson credited Blesi with connecting her with Carter, Drenckhahn and her general contractor, Dean Soderbeck of Soderbeck Design & Construction, Shoreview.

“I had this vision in my head for years,” Simpson said. “If I hadn’t started working with her, I would have never realized I could do this.”

“The smaller businesses that have less than 10 employees, they trudge along for a very long time and they don’t make a lot of money,” said Blesi, a former banker. “Just because you’re doing what you’re doing doesn’t mean it has to stay that way.”